The Mediating Effect of Cognitive and Emotional Satisfaction on Customer Loyalty Maznah Wan Omar Universiti Teknologi MARA Kedah Peti Surat 187, 08400 Merbok, Kedah, Malaysia firstname.lastname@example.org
ABSTRACT Loyal customers are among the greatest revenue producer and are more likely to occur in a form of word-of-mouth. In the compound and vibrant Malaysian home computer retail market today, customer loyalty through word-of-mouth marketing tends to occur very slowly and is limited geographically but is a very potent method of marketing. The influence of cognitive and emotional satisfaction on the relationship between salesperson presentation skills and customer’s loyalty through intention to promote by word-of-mouth is vital. This will then lead to increased benefits for the organization in the form of customer loyalty. The cognitive evaluation of customer satisfaction was found to explain customer loyalty in a retail setting more than the emotional reaction. This finding holds importance to those retailers who have been able to generate high expectations in the eyes of their customers. Keywords: Adaptive selling skills, sales presentation skills, Customer satisfaction, Customer loyalty INTRODUCTION As competition deepens, products and services become more indistinguishable, and markets become established, it is becoming increasingly tougher for companies in retailing industries to distinguish themselves from other stores. Simply offering customers with technical solutions to problems does not be sufficient anymore to be competitive and obtain and retain market share. Various value-added services, which commence before the actual operation begins, had gone far beyond it, so as to stay competitive and develop customer loyalty. Research and business customs have shown that upholding customers through value-added services costs less than obtaining new ones (Wetzels et al., 1998). A prevailing belief holds that an essential key to performance rests with the ability to sustain 1
International Journal of Management Innovation Systems ISSN 1943-1384 2009, Vol. 1, No. 2: E5
customer relationships (Anderson et al., 1994). Correspondingly, as relational value continues beyond price, customer bond are particularly effective when involved in long-term relationships (Wood, 1995). LITERATURE REVIEW Salesperson Behavior Performance In recent years, a number of authors have been confronted with this issue of the changing role of the sales force. Up-and-coming trends of the extent and scope recorded above require a re-evaluation of the activities that salespeople must execute in order to successfully build and manage customer loyalty. Marshall et al., (1999), interviewed a diversity of professional salespeople to give evidence for 49 new sales activities that were not pointed out in Moncrief’s (1986) original list. These latest activities fall into the following main categories: communication technology, selling technology, activities related to adaptive and consultative selling, and team-oriented activities. Many of the specific activities within these categories involve skills and content knowledge dissimilar from those traditionally observed in the past as key salesperson success factors. This study therefore will consider how cognitive and emotional satisfaction mediates the relationship between salesperson presentation skills and customer’s intention to word-of-mouth. These situational factors have not been considered in prior research and provide new avenues for examining salesperson presentation skills in Malaysian market and its consequences. Additionally, as most studies have considered salespeople as their unit of analysis, this study will add to the small but imminent body of research that investigates performance and effectiveness relationships at the customer’s level. Formation of loyalty...